The Detroit News reports that the White House wants the feds to cover GM, Ford and Chrysler’s bad paper. “White House spokeswoman Dana Perino said that GMAC, Ford Motor Credit and Chrysler Financial could be part of the Trouble Asset Relief Program — the $750 billion Wall Street rescue package approved by Congress. ‘It’s possible that some of those financing arms could be a part of the rescue package — the TARP, as they call it at the Treasury Department. So that’s why — that’s one of the reasons Treasury has been in contact with them.’” (The other: to buy 5k Trailblazers on the cheap.) Meanwhile, The Energy Department named a senior career U.S. Treasury Official named Lachlan W. Seward to oversee the Department of Energy’s $25b low-interest-for-20-year-old-or-more-auto-plant-retooling loan program. (Either that or buy Siberia from the Russians.) Parenthetical asides aside, it looks like TTAC’s Ken Elias was on to something. Something that smells BAD. “People familiar with the matter said General Motors Corp. chairman and CEO Rick Wagoner was in Washington last week for meetings with U.S. Treasury officials. GM spokesman Greg Martin declined to confirm or deny the visit. Bloomberg News reported that GM had offered to swap an equity stake in the company in exchange for federal help.” Looks like I was right about the race against bailout fatigue, as well.
“GMAC has held discussions with Treasury, FDIC and the Federal Reserve. ‘We certainly are pursuing avenues to see which if any of federal tools might provide some relief,’ GM spokeswoman Toni Simonetti said Monday. She noted they have seen constrained funding and ‘had to dial down our business.’”
4 Comments on “Bailout Watch 124: White House Says TARP Covers Auto Loans...”
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I liked this whole bailout thing better when the acronym was the “Securitized Housing Investment Trust.”
I thought that it has been pretty much a given for a few weeks now that bad auto loans from the big three finance arms were going to be included.
So at the end of the day the Congress apparently handed the Bush Treasury authority for a $700 billion revolving line of credit to whatever if feels like with, eh? Snookered again. Can we start a countdown to inauguration day watch?
So now we’re bailing out unemployed college grads for their modded Jettas?
“GM had offered to swap an equity stake in the company in exchange for federal help”
Isn’t that kinda the same premise that hookers work on?